Radio Workshop

Hecho En Beijing (Transcript)

by Gretchen Wilson

AMB - Sound of 7 train.

NARR - Below the rumble of the elevated 7 train in the Jackson Heights neighborhood of Queens, Lou Lui sits in front of a space heater in a tiny, open-air store no bigger than a large closet.

AMB - Honks of street.

The store is located on busy Roosevelt Avenue. Colorful baseball hats, plastic hair accessories and toys spill out from the tiny store onto the tables on the sidewalk. Much of the merchandise is targeted to the area's growing Mexican community.

AMB - Man yelling "corte pelo."

On this unusually cold spring day, Lou is bundled up in a yellow jacket and dark blue shawl. He and his wife, Maria, have taken turns attending the store from 9 in the morning until 9 at night for the past three years. The faltering economy has meant business has been slow and Lou says that keeping prices low is the key to the success of retailers in this working-class urban community.

TAPE - LOU - Mainly we sell item around 10, 15 dollars. In this area, you cannot go too high a price. (:11)

NARR - Out front, one of the low-cost items for sale is a red terrycloth headband with a sewn-on patch that says "Mexico." But it wasn't made in Mexico. A small gold sticker reveals that, like most of the products that Lou and Maria sell, it was "Made in China."

China is the biggest trading partner with the port of New York and New Jersey. Like many small business owners in the region, Maria and Lou buy Chinese imports from wholesalers and then sell them again at a profit.

Lou says that it is the inexpensive labor market in China that allows both importers and retailers like him to keep prices low.

TAPE - LOU - By doing that, the importer makes some money and we, as a retailer, also make some money. And then when we sell to the end user, they don't have to pay of a high price. That's why we're able to sell item like a dollar, three dollar, very, very cheap price. (:19)

And cheap prices are the reason for the success of Chinese imports here in the United States, where trade with China has grown dramatically. Last year, China surpassed Japan to become Asia's leading exporter to the United States. According to a February study by the trade group Manufacturers Alliance, U.S. imports from China rose 86 percent in the past five years, while imports from other countries have increased by only 29 percent.

Phillip Byrd is director general of the American Importers Association, a trade organization of over 17,000 companies.

TAPE - BYRD -There has been, as everybody knows, just an explosion of exports from China to the United States over the past few years or so. (:08)

Byrd says that China's growth has been unprecedented since it entered the World Trade Organization in 2001. In the last year, China's total exports rose more than 22 percent in a twelve-month period, a trend that economists expect to continue.

TAPE - BYRD - The cost of labor overseas is so much cheaper than it is here in the United States, it just isn't practical to produce these items, like pens and paperclips and things like that in the U.S. It's just not economically practical anymore. (:16)

TAPE - KERNAGHAN - The issue is can the U.S. companies compete with production costs in China. And the answer is no, it's impossible.

Charles Kernaghan is the director of the New York-based National Labor Committee.

TAPE - KERNAGHAN - It's hard to compete with workers have no rights, who are earning 13 cents an hour, who are forced to work seven days a week, up to 18 and a half hours a day…

He says that the outsourcing by U.S. companies to lower-cost markets has resulted in the loss of over 2 million of domestic manufacturing jobs.

But it is not just jobs in the United States that have been lost. Kernaghan says inexpensive labor means that U.S. companies are increasingly moving manufacturing from other developing countries to China.

TAPE - KERNAGHAN - To be really clear, people in China, they're not our enemies, they are not stealing our jobs, it's not that at all. It's just that, in China, you have a ruthless government where there are no rights, and you have workers very much in a trap. (:17)

Human rights advocates have joined labor organizations in calling attention to the working conditions in China. But not everyone agrees with them. Representatives of some of the U.S. companies that use Chinese factories say that rapid development in the country will benefit workers there and some analysts predict that this increased wealth may foster democratic reforms.

Still, over the next few years, consumers in the United States will likely see more and more products imported from China.

Back at Lou's store, customer A.J. Massoud considers buying a plain white T-shirt.

Doc. sound - Customer: "White, white T-shirts? Is that a 1 X? Lou: Yeah. That's four dollars.

A.J. - I like his prices, his quality. It's good. It's all about the savings.

China's success in creating relatively inexpensive imports - like white t-shirts - means that consumers in the United States are able to buy more in a sluggish economy.

For Columbia Radio News, I'm Gretchen Wilson.